Whitehaven posts profit

WHITEHAVEN Coal has delivered a net profit after tax of $A19.9 million for the six months to December 31, 2011, compared to a loss of $35.1 million in the same period of 2010, on the back of higher tonnages of legacy contracts during the period.
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Whitehaven's Narrabri mine.

Staff Reporter

The coal miner reported earnings before interest, tax, depreciation and amortisation of $58 million, including a $28.8 million loss from sales of purchased coal and cash settlement of legacy contracts.

Sales revenue for the period came in at $340.4 million, up from $318.3 million in the previous corresponding period.

Cash used in operations was $32.3 million with net cash outflow of $104.1 million.

During the period, saleable coal production gained 14% to 2.16 million tonnes while total coal sales fell 4% to 2.9Mt.

Legacy contract deliveries for the half totalled 850,000 tonnes with a further 730,000t settled from the purchase of coal or cash settlement, leaving 330,000t of legacy contracts remaining to be delivered in the current quarter.

Open cut production was adversely affected in the last few months of the period with the interruption of explosives deliveries following the Orica plant shutdown in Newcastle resulting in changes to mining sequences at most mines.

Production was also impacted by adverse weather in November and December.

The company has decided not to pay an interim dividend for the half year pending the outcome of the proposed merger with Aston Resources, where a conditional special fully franked dividend of 50c is proposed to be paid to Whitehaven shareholders once the deal has been finalised.

Looking ahead, Whitehaven expects longwall operations at Narrabri underground to kick off in late April, which will provide a significant boost to the company’s coal production.

Shares in Whitehaven were last trading 3c lower at $5.55.